Copper Rises as Low European Rates Boost Demand Outlook

Oct. 4 (Bloomberg) -- Copper futures advanced for the fifth
time in six sessions as European policy makers held borrowing
costs at record lows, bolstering prospects for metal demand.

The European Central Bank left its benchmark interest rate
at 0.75 percent, and the Bank of England held its key rate at
0.5 percent. The dollar headed for the biggest drop in three
weeks against a basket of currencies, boosting the appeal of
commodities as alternative investments. The Standard & Poor’s
500 Index of equities rose for the fourth straight day.

“The positive equity story reflects both a growth and risk
story and also expectations of more liquidity, and those same
expectations drive other risk assets, in particular copper,”
said Justin Smirk, an analyst at Westpac Banking Corp. in Sydney
and the most accurate forecaster for industrial metals in
Bloomberg rankings in the past eight quarters.

Copper futures for December delivery rose 0.1 percent to
settle at $3.786 a pound at 1:23 p.m. on the Comex in New York.
The price has gained 10 percent this year on speculation that
government stimulus plans will shore up their economies.

On the London Metal Exchange, copper for delivery in three
months climbed 0.1 percent to $8,300 a metric ton ($3.76 a
pound). Aluminum, nickel, tin advanced, while lead and zinc
fell.